Contracts Flashcards
7 cards from real Real Estate License practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Contracts flashcards as text
Liquidated damages in a purchase contract typically refer to:
Answer: A predetermined sum agreed to in advance
Liquidated damages are a sum the parties agree in advance to be paid if one party breaches.
If a seller breaches a real estate sales contract, the buyer may seek 'specific performance,' which means:
Answer: A court order forcing the seller to convey the property
Specific performance is an equitable remedy compelling the breaching party to complete the agreed sale.
An 'option contract' gives the holder the right to:
Answer: Purchase property within a set time for a set price
An option contract grants the right, but not the obligation, to buy at a fixed price within a time period.
A contingency in a purchase agreement is best described as:
Answer: A condition that must be met for the contract to proceed
A contingency is a condition (such as financing or inspection) that must be satisfied for the contract to close.
Time is of the essence in a contract means:
Answer: Parties must perform exactly by the stated dates
This clause makes the stated deadlines strict, and failure to perform on time is a breach.
Earnest money is best described as:
Answer: A good-faith deposit showing the buyer's serious intent
Earnest money is a deposit demonstrating the buyer's sincere intention to complete the purchase.
Which of the following would make a contract 'void' rather than 'voidable'?
Answer: An illegal purpose
A contract for an illegal purpose is void from the start and has no legal effect.